Indian salon chain Naturals remains in active discussions with Reliance Industries over a potential stake sale, but negotiations have slowed as the two sides have yet to agree on a deal structure, co-founder and CEO C.K. Kumaravel told Reuters on the sidelines of a Retailers Association of India event in Mumbai on Tuesday.
Kumaravel confirmed that Reliance initially sought a 51% controlling stake, while Naturals was willing to sell only 49% to retain operational control for several more years before considering a larger divestment.
“Even if it takes time, Naturals is not in a hurry, as Reliance will add significant value,” he said, adding that the company is not in parallel talks with other investors.
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Talks between the two parties were first publicly disclosed in late 2022. A deal would give Reliance—India’s largest private-sector company—an entry into salon and spa services, complementing its fast-growing beauty retail platform Tira (launched in 2023) and its broader consumer-facing ambitions in fashion, jewelry, and lifestyle through Reliance Retail.
Naturals operates approximately 900 salons across India, making it one of the country’s largest organized salon chains—ahead of peers such as Lakmé Salon and Geetanjali Salon—in a market still dominated by unorganized, neighborhood parlors. The company reported gross merchandise value (GMV) of ?4.5 billion ($49.64 million) in fiscal 2025 and expects that figure to rise to ?6 billion this financial year.
The chain plans to open 100 new salons in 2026, with a focus on dense urban clusters (starting with Pune) rather than scattered locations. This “hub-and-spoke” approach aims to improve operational efficiency and brand visibility in high-traffic areas.
India’s beauty and salon market, valued at $10.8 billion, continues to expand rapidly. Rising disposable incomes, increased female workforce participation, urbanization, and growing male grooming demand are driving growth in organized players, according to consultancy Ken Research. The organized segment remains small (estimated at 10–15% of the total market), leaving significant headroom for consolidation and professionalisation.
The IPO Option
If talks with Reliance fail to produce an agreement, Naturals intends to pursue an initial public offering (IPO) by 2028, Kumaravel said. An IPO would provide capital for aggressive expansion, strengthen brand credibility, and create liquidity for early investors and founders.
The company’s decision to keep Reliance as the sole active counterparty reflects the strategic fit: Reliance’s vast retail footprint, supply-chain capabilities, and marketing muscle could accelerate Naturals’ growth and help it capture share from unorganized players. However, the 51% vs. 49% control disagreement highlights a classic founder-investor tension: Naturals’ leadership wants to retain decision-making authority during a high-growth phase, while Reliance typically seeks controlling stakes in consumer-facing businesses to integrate them fully into its ecosystem.
India’s organized beauty and wellness sector is attracting significant investor interest. The combination of rising consumer spending on grooming, increasing acceptance of premium services, and the shift from unorganized to branded salons has created a compelling growth story. Competitors like Lakmé (Hindustan Unilever), Geetanjali Salon, and Jawed Habib are also expanding, but Naturals’ scale and focus on mid-premium positioning have given it a strong foothold.
Reliance’s interest aligns with its aggressive push into consumer-facing businesses through Reliance Retail (fashion, groceries, electronics) and Tira (luxury beauty retail). A Naturals stake would extend its presence into salon services—a natural adjacency to beauty retail—while tapping into recurring revenue from memberships, product sales, and services.
The talks also reflect a broader trend of Indian conglomerates and private equity firms eyeing consolidation opportunities in fragmented consumer services sectors such as salons, gyms, diagnostic chains, and education. Organized players with strong unit economics and scalable brands are commanding premium valuations in a market still dominated by mom-and-pop operations.
Outlook and Risks
While Naturals is not in a hurry, prolonged negotiations could delay expansion plans or force the company to seek bridge financing. An eventual IPO in 2028 would depend on sustained growth, profitability improvement, and favorable market conditions.
For Reliance, a Naturals deal would represent a relatively small but strategically logical addition to its consumer portfolio. The company has shown a willingness to pay premium valuations for assets that strengthen its ecosystem.
The outcome—whether a deal with Reliance, a standalone IPO path, or a hybrid—will likely shape Naturals’ trajectory in India’s fast-growing organized beauty and wellness market. With consumer spending on grooming continuing to rise and organized players gaining share from unorganized salons, the company is well-positioned for multi-year growth regardless of the ownership structure ultimately chosen.